24 February 2009

Save Money On Automobile Gas, Repairs, Purchase and Insurance

Here's how to save money on gas, repairs, purchase/lease, and on insurance:

New Cars-
You can save thousands of dollars over the lifetime of a car by selecting a model that combines a low purchase price with low depreciation, financing, insurance, gasoline, maintenance, and repair costs. Consumer Reports and other magazines usually have charts with this information. Once you have selected a model and options you are interested in, you can save hundreds of dollars by comparison shopping. Get price quotes from several dealers (over the phone or Internet) and let each know you are contacting the others. Also get written offers on your trade-in. Many years ago I went to three different dealers to buy the same car. Their selling prices were very close to eachother but my highest trade-in offer was $3500 more than my lowest offer! Remember there is no "cooling off" period on new car sales. Once you have signed a contract, you are obligated to buy the car.

Used Cars-
Before buying any used car, compare the seller's asking price with the average retail price in a the Kelley Blue Book, Redbook or other guide to car prices which can be found at many libraries, banks, and credit unions. Check your potential car out in Consumer Reports. Does it have a good history in reliability and average upkeep cost?Have a mechanic you trust check the car, especially if the car is sold "as is." Consider purchasing a used car from an individual you know and trust. They are more likely than other sellers to charge a lower price and point out any problems with the car. Outright ask the seller to divulge any problems encountered in the last 5 years and what was done to fix them. Ask what shop they took their car to and visit that shop - ask to see a history of work done on that car.

Auto Leasing-
Don't decide to lease a car just because the payments are lower than on a traditional auto loan. The leasing payments are lower because you don't actually own the car.
Leasing a car is very complicated. You must consider the price of the car (known as the capitalized cost), your trade-in allowance, any down payment, monthly payments, various fees (excess mileage, excess "wear and tear," end-of- lease), and the cost of buying the car at the end of the lease. A valuable source of information about auto leasing can be found in Keys to Vehicle Leasing: A Consumer Guide, which is published by the Federal Reserve Board and Federal Trade Commission.

Do a side-by-side comparison of buy vs. lease on the same car. What is the difference in monthly payments? Is it a big difference or a small one? What is the final cost if you keep the lease as compared to buying it outright. Your interest rates of buy vs. lease might make a difference. Call a few banks to get their loan rates. You usually get a discount from the bank you already have an account with but that's not a guarentee you'll get the best rate from them. Bring this info with you when you car shop. The dealer probably does business with a bank as well and might be able to beat your best rate, but not always.

Do compare what you'll spend on gasoline in a year. Miles per gallon is important to consider if you do any distance driving! Also ask your insurance agent to give a rates for each of your options. One choice might cost you $1000 per year more than the other choice. Avoid surprises when it comes to insuring your new vehicle!

You can save hundreds of dollars a year by comparing prices at different stations, pumping gas yourself, and using the lowest-octane called for in your owner's manual. You can save up to $100 a year on gas by keeping your engine tuned and your tires inflated to their proper pressure. Some grocery stores are now giving out discounts if you buy at their gas stations. The store keeps track of dollars spent on food shopping. You swipe your grocery card at the pump to get the discount. I shop at Giant. My last fill-up got me a 70 cents per gallon discount!

Car Repairs-
Consumers lose billions of dollars each year on unneeded or poorly done car repairs. The most important step that you can take to save money on these repairs is to find a skilled, honest mechanic. Before you need repairs, look for a mechanic who, is certified and well established, has done good work for someone you know, and communicates well about repair options and costs. If something needs to be replaced, tell the mechanic you want to see the faulty/broken part first. Make them show you the crack (or whatever it is). There are some things you can do yourself and you'll pay alot less for the part and not have to pay labor - oil changes, air filter, and toping off anti-freeze, oil and wiper fluid. Just make sure you check them every month!

Auto Insurance-
You can save several hundred dollars a year by purchasing auto insurance from a licensed, low-price insurer. Call your state insurance department for a publication showing typical prices charged by different companies. You can also get comparisons from Progressive. Then call at least four of the lowest-priced, licensed insurers to learn what they would charge you for the same coverage. Talk to your agent or insurer about raising your deductibles on collision and comprehensive coverage to at least $500 (if you can afford $500 should an accident happen) or, if you have an old car, dropping this coverage altogether. My car is old but my comp/collision is only $50 a year, so I'm keeping it. This can save you hundreds of dollars on insurance premiums.
Make certain that your new policy is in effect before dropping your old one. If you have renter's or homeowners insurance, you might get a discount on that or the auto policy if you go through the same insurer for both.

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